Chicago Plans Expanded Debt Collection Efforts in 2027 as Recoveries Approach $120 Million
Chicago officials are planning to expand municipal debt collection efforts in 2027, targeting corporate debtors, increasing administrative enforcement and improving electronic filing systems as the city projects more than $120 million in collections for 2026.
During a Nov. 10 budget hearing, the Chicago Department of Law outlined its plans to strengthen recovery of unpaid utility bills, vehicle-related debt, fines and administrative judgments. The proposed changes include additional collection attorneys and a new accounts receivable program focused on outstanding corporate obligations.
According to The Daily Line’s reporting, Deputy Corporation Counsel David Holtkamp told alderpeople that collections are on track to increase 31% over the past two years.
Chicago Debt Collections Expected to Exceed $120 Million
The Department of Law projects more than $120 million in debt recoveries by the end of 2026, including several significant collection categories:
- Utility debt: $40.2 million, representing what officials described as a record year for utility bill collections.
- Vehicle-related debt: Approximately $30 million.
- Administrative hearing judgments: More than $17 million.
- Employee wage garnishments: Approximately $2 million, up from $226,000 in 2022.
Officials attributed part of the increase in garnishment-related recoveries to expanding administrative wage garnishment hearings from one to five per month in 2024.
Holtkamp said the increased enforcement activity has also encouraged employees facing potential garnishment to enter voluntary payment arrangements.
Corporate Receivables and Electronic Filing Are Priorities for 2027
Chicago plans to place greater emphasis on collecting debts owed by corporations and absentee property owners.
The Department of Law intends to coordinate with other city departments to establish an accounts receivable program designed to identify outstanding corporate obligations and encourage faster repayment.
Officials also plan to expand electronic debt complaint filing through the Department of Administrative Hearings. The system, currently available for utility-related matters, is expected to cover additional municipal debt categories in 2027.
The department will also pursue immediate maximum fines against repeat offenders as part of its enforcement strategy.
Proposed Budget Adds Four Collection Attorneys
The city’s proposed 2027 budget would increase Department of Law appropriations by approximately $2.7 million, or 5.7%, bringing the department’s total to $50.7 million.
According to the Better Government Association’s analysis of the proposed budget, the department would add four positions, increasing its authorized workforce to 422 employees.
All four positions would support the Collections, Ownership and Administrative Litigation Division, which handles debt recovery, bankruptcy litigation and property acquisitions through lien foreclosures.
The proposal remains subject to City Council approval.
